The Australian Prudential Regulation Authority (APRA) today released for comment four draft revised Prudential Standards (including their related Guidance Notes) for authorised deposit-taking institutions (ADIs). These Standards give effect to the policy framework for prudential supervision of conglomerate groups containing ADIs that was described in earlier Policy Discussion Papers.
The four draft ADI Standards (and their related Guidance Notes) incorporate APRAs proposals on large exposure limits (both intra-group and external) and the measurement of capital adequacy in conglomerate groups, as set out in APRAs discussion paper Capital Adequacy and Exposure Limits for Conglomerate Groups including ADIs issued in October 2001. The draft Standards also incorporate policy proposals on risk management and group relations (such as common badging, distribution of products and shared premises) detailed in our April 2000 Policy Information Paper.
On a separate track, we have started the drafting of new Prudential Standards for authorised non-operating holding companies (NOHCs). These draft Standards will incorporate all the prudential requirements for authorised NOHCs covered in the April 2000 and October 2001 papers (such as board composition, fit and proper tests for directors and senior management, group risk management, organisational structures and permissible activities). The draft NOHC Standards will be released for industry comment over coming months.
There will be a three-month consultation period for ADIs and other interested parties to comment on the revised Standards issued today. As proposed in its October 2001 paper, APRA expects all these conglomerates-related Prudential Standards to be finalised in the first half of 2002, with implementation from end 2002. There will be a three-year transition period for ADIs that need to wind back exposures or adjust their capital structures.
The four draft revised ADI Standards (and their related Guidance Notes) are:
- APS 110 Capital Adequacy;
- APS 111 Capital Adequacy: Measurement of Capital;
- APS 221 Large Exposures; and
- APS 222 Equity Associations (with a new title "Associations with Related Entities").
These draft Standards, as well as the Policy Discussion Papers issued in April 2000 and October 2001, are available on the APRA website (www.apra.gov.au/policy).
For further information, contact:
|
Mr Greg Brunner
General Manager
Policy Development & Statistics
(02) 9210 3148 |
Mr Wayne Byres
General Manager
Risk Analysis & Research
(02) 9210 3146 |
Comments on the revised draft ADI Standards are invited by 29 March 2002, and should be sent to Mr Brunner at the following address:
Australian Prudential Regulation Authority
GPO Box 9836
Sydney NSW 2001
or
conglomeratestds@apra.gov.au
